Repainting VS Non-Repainting Indicator Strategies
Indicator Trading Strategy – Repainting VS Non-Repainting Indicator Strategies.
Now I have made a couple of trading videos on the Trading Rush Channel. Most of the time, when someone new asks a question in the comment section, wonderful people who regularly watch the Trading Rush videos, answer them quickly. But some questions are too complicated to be answered in the comments. That’s why In this video, I’m going to answer some of the most asked questions on this channel.
Repainting indicator, is an indicator that changes its historical values.
There are two kinds of repainting indicators. One is like the Fractal Indicator, and this one is a useful one. But then there is a second kind of repainting indicator, this kind will repaint the entry signals, if it fails to predict the correct direction. Most of the new traders are really confused about these repainting indicators. Some of them say, all indicators repaint the historical values. If you say something like that, you probably don’t understand how an indicator works. Most of the popular indicators do not repaint their historical values.
Let me explain. I have tested many different strategies on the Trading Rush Channel. One of them was the MACD strategy. The entry signals generated by the MACD while back testing, and in Liive Market, won’t repaint, as long as you have the proper MACD indicator applied on your chart.
That’s because, MACD is only looking at past data to give the crossover entry signals. MACD calculates its data by looking at the closing price of the candles. When I was testing the MACD strategy 100 times, I was entering my trades at the closing price of the candle.
There is no way in the world, that MACD will repaint the data in a Liive market.
The only place you will see the MACD repainting the data, is at the running candle. MACD will change the data at the running candle, because the candle is still running. If the candle is still running, it is not closed. Since MACD is calculated using the closing price of the candle, and If the candle is not closed yet, why are we entering the trades on the running candle and blaming the indicators?
MACD is a not a repainting indicator.
But Fractal kind of is. When I made the Fractal Video on this channel, I clearly explained that, fractal is based on 5 candles. Two candles on the left. And two candles on the right. The two candles on the left are historical candles. They will never change their values. But on some Trading Platforms, Fractal will repaint itself, if the two candles on the right are not formed yet. In simple words, fractal will disappear and reappear, if the two candles on the right are still running.
Like i said before, most indicators are based on the closing price of the candles. In this case, fractal appears and disappears, because the candles on the right are still running. When the two candles on the right, are closed, and if there is a proper fractal pattern formed, Fractal arrow will not disappear. That’s why, In my fractal video, when I explained how the fractal works, I clearly said, Only take trades on the opening price of the third candle after the arrow.
If you wondered why fractal arrows disappear and reappear, Now you know why.
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